Can you remember 10.05pm on Thursday, 7th May
2015 ... with the shock news that BBC Exit Polls suggested the Conservatives
would return with a majority? The middle classes in Templewood Avenue and Redington
Road exhaled a huge sigh of relief, as Hampstead landlords, faced with rent
controls from Red Ed and the Labour Party now had something to cheer about. The
Tory’s were always considered to be a political party that accepted the
importance of the rental market and supported its development whilst properly
targeting the lawbreaker landlords renting out sub-standard rental
accommodation.
Since May though, George Osborne announced future rises in
stamp duty for buy to let landlords and a change in the interest relief on buy
to let mortgages, some people have now started to question that loyalty.
However, things could have been a lot worse for Hampstead landlords as previous
ideas of making them pay more tax was the idea (which was seriously considered)
of increasing Capital Gains Tax rates to the landlord’s own income tax levels.
If Landlords would have had to pay capital gains tax of 40% to 45% on any
uplift in value, I can tell you here and now, that would have made investing in
property a non-starter for almost everyone.
However, I will admit the loss of mortgage higher rate tax
relief will make a number of properties not stack up financially. The new rules
are likely to slow demand in the Hampstead housing market, which is in fact
good news for the other landlords, as there is less competition from 'amateurs'
offering too much.
Just
a thought, but making Hampstead landlords think twice and
run
their numbers more cautiously is not such a bad thing.
So looking at the numbers, the November figures have just
been released and they show a growth of property values in Hampstead of 0.6%
over the month of November. That figure doesn’t surprise me due to the time of
year. It’s quite dangerous to look at one month in isolation, so looking at a
more medium term view, over the last 12 months, property values in Hampstead
have risen by 4.5%, not bad when you consider inflation is running at -0.1%.
However, regular readers of the Hampstead Property Blog know
my passion for looking deeper into the stats. The really interesting information
is the value growth, but what types of property are actually selling in Hampstead?
Looking at
Property Type
|
Sept 2007
|
Sept 2015
|
Difference
|
Semis in Hampstead
|
3
|
3
|
0%
|
Terraced Houses in Hampstead
|
9
|
1
|
-88.9%
|
Apartments / Flats in Hampstead
|
75
|
71
|
-6.6%
|
Now I have mentioned in previous articles that the numbers
of properties selling in the suburb has certainly dropped post 2008, but what
amazed me were the drop in the number of terraced houses selling compared to flats/apartments. This trend is largely driven by demographic factors.
Less
properties are selling than last decade in Hampstead
and the
types of properties selling have changed ...
interesting
times ahead for the Hampstead Property market!
Therefore, all I can say to the landlords of Hampstead is do
your homework, make sure the numbers stack up, take advice and opinion from
professionals and above all, for those of you planning to add to your
portfolio, buy the right property at the right price. One place for such advice
and opinion on the Hampstead Property market is the Hampstead Property Blog www.NW3propertyblog.com
If you are looking for an agent with experience that can help you find the right tenant for your property, then contact us to find out how we can get the best out of your investment property. Email me on chris@ashmoreresidential.com or give me a call on 020 7435 0420. Pop in for a chat – we are based on Ashmore Residential, Suite 7, 25-27 Heath Street, London, NW3 6TR. The kettle is always on.
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